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Technical Assistance Consultants Report The views expressed herein are those of the consultant and do not necessarily represent those of ADB’s members, Board of Directors, Management, or staff, and may be preliminary in nature. Project Number: 42537 June 2012 Monitoring and Evaluation of the Philippine e-Government Procurement System: Baseline Report covering 2001-2007 (Financed by PATA 7244-PHI: Strengthening the Philippine Government Electronic Procurement System Prepared by Transparency and Accountability Network Philippines

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Page 1: Technical Assistance Consultant s Report fileTechnical Assistance Consultant’s Report ... views and policies of the Asian Development Bank (ADB) or its Board of Governors or the

Technical Assistance Consultant’s Report

The views expressed herein are those of the consultant and do not necessarily represent those of ADB’s members, Board of Directors, Management, or staff, and may be preliminary in nature.

Project Number: 42537 June 2012

Monitoring and Evaluation of the Philippine e­Government Procurement System: Baseline Report covering 2001­2007 (Financed by PATA 7244-PHI: Strengthening the Philippine Government Electronic Procurement System Prepared by Transparency and Accountability Network Philippines

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DISCLAIMER

The views expressed in this report are those of the author and do not necessarily reflect the views and policies of the Asian Development Bank (ADB) or its Board of Governors or the governments they represent. ADB does not guarantee the accuracy of the data included in this publication and accepts no responsibility for any consequence of their use. By making any designation of or reference to a particular territory or geographic area, or by using the term “country” in this document, ADB does not intend to make any judgments as to the legal or other status of any territory or area. ADB encourages printing or copying information exclusively for personal and noncommercial use with proper acknowledgement of ADB. Users are restricted from reselling, redistributing, or creating derivative works for commercial purposes without the express, written consent of ADB.

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Table  of  Contents              1. Introduction  2. Scope  and  Limitations  3. Evaluation  Framework  4. Brief  Description  of  the  System  5. Summary  of  Findings  and  Analyses  6. Conclusion  and  Recommendations  7. Annexes                                                                  

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Introduction      1. The  Transparency  and  Accountability  Network  (TAN)  is  a  multi-­‐sectoral  

coalition  composed  of  25  member  organizations,  which  was  established  in  2000  to  contribute  significantly  to  the  reduction  of  corruption  in  the  Philippines.  In  line  with  this  mission,  it  had  been  at  the  forefront  of  key  governance  reform  advocacies,  which  include  procurement.      

2. With  a  track  record  of  advocating  for  procurement  reform,  TAN  had  been  engaged  by  the  Asian  Development  Bank  to  undertake  monitoring  and  evaluation  of  the  implementation  of  Technical  Assistance  7244  (see  http://www.adb.org/Projects/project.asp?id=42537)  and  the  improvements  brought  about  by  the  assistance  in  the  Philippine  Government  Electronic  Procurement  System  (PhilGEPS).    

 3. The  PhilGEPS  is  the  single,  centralized  electronic  portal  that  shall  serve  as  the  

primary  and  definitive  source  of  information  on  government  procurement  (Section  8,  Republic  Act  9184).  Through  R.A.  9184,  government  entities  are  required  to  post  all  procurement  opportunities,  bid  results,  and  other  related  information  on  the  procurement  of  goods  and  general  services,  civil  works,  and  consulting  services.    

 4. At  the  onset,  the  study  team  is  presented  with  the  challenge  of  low  

compliance  for  posting  of  contract  awards  as  mandated  by  procurement  rules  and  regulations.  Reportedly,  there  had  been  a  dramatic  increase  in  the  posting  of  bid  notices  since  the  beginning  of  PhilGEPS  but  the  experience  is  not  the  same  for  the  posting  of  bid  results.    

 5. The  ADB  technical  assistance  papers  posit  that  the  extent  to  which  market  

players  and  other  stakeholders  will  be  able  to  maximize  use  of  the  PhilGEPS  depends  on  the  accessibility  of  the  system  and  its  adherence  to  the  principles  of  transparency,  fairness,  impartiality,  efficiency,  and  effectiveness.  These  will  form  the  bases  for  evaluating  the  PhilGEPS  development.    

 6. TAN  has  commenced  monitoring  and  evaluation  of  the  PhilGEPS  in  April  3,  

2012  and  will  conclude  its  report  on  June  30,  2012.  Building  on  the  final  report,  TAN  submits  herewith  its  assessment  of  the  use  of  the  PhilGEPS  during  a  baseline  reference  period  (2001-­‐2007).  

               

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           Scope  and  Limitations  of  the  Evaluation      8. The  evaluation  team  was  given  access  to  the  PhilGEPS  database  through  

auditors’  accounts  provided  by  the  project  management  office.  In  this,  the  team  had  access  to  the  following  types  of  reports:    

 Management  Reports  

 • Subscriber  Organizations  by  Country  and  Province/  State  • Supplier  Organizations  by  Form  of  Organization  • Bid  Notices  Posted  by  Region  • Bid  Notices  Posted  by  Business  Category  • Buyer  Organization  by  Government  Branch  • Notices  Posted  by  Region  • Notices  Posted  by  Business  Category  • Amount  of  Notices  Posted  on  the  GEPS  

 Data  Dump  

 • Organizations  • Bid  Notices  and  Awards  Summary  • Order  by  Bid  Notices  • Registered  Users  • Bid  Notice  and  Award  Details  • System  Activity  Records  

 9. The  team  is  limited  by  the  database  design/  framework  of  the  PhilGEPS,  

which  will  be  discussed  in  detail  in  the  Summary  of  Findings  and  Analyses.    Baseline  Period  2001-­2007      10. The  team  analyzed  data  from  periods  2001-­‐2007  for  this  baseline  report.  The  

choice  of  the  baseline  periods  (2001-­‐2005  and  2006-­‐2007)  is  founded  on  the  development  history  of  the  PhilGEPS:    10.1. In  2000,  the  pilot  electronic  procurement  system  was  launched  

under  the  authority  of  Executive  Order  322  s.2000.      

10.2. In  2003,  the  Government  Procurement  Reform  Act  was  passed  into  law,  which  reiterated  the  use  of  PhilGEPS.    

 10.3. In  2006,  a  new  PhilGEPS  was  launched.    

 

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11. Following  these  developments,  the  baseline  periods  2001-­‐2005  and  2006-­‐2007  have  been  chosen  by  the  team  to  coordinate  with  the  major  periods  of  development  of  the  electronic  procurement  system.      11.1. Baseline  period  2001-­‐2005  represents  use  of  the  e-­‐procurement  

system  by  national  government  agencies  (NGAs)  during  its  first  design  and  development.  The  analysis  gives  special  attention  to  the  years  2003-­‐2005,  where  then  the  Government  Procurement  Reform  Act  had  been  passed  into  law  and  coverage  was  expanded  to  all  government  agencies  and  instrumentalities.      

11.2. Baseline  period  2006-­‐2007  represents  initial  use  of  the  e-­‐procurement  system  during  the  relaunch  of  the  PhilGEPS.    

   12. The  full  report  will  cover  the  period  2008-­‐2011  (see  Annex  A.  for  outline),  

which  assumes  the  system’s  complete  transfer,  stable  functionality,  and  familiarity  and  maximum  use  by  various  stakeholders.  During  this  period,  the  PhilGEPS  is  no  longer  at  its  initial  and  pilot-­‐test  phase  but  has  developed  to  be  a  system  at  a  mature  stage  of  development.    

                                                             

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         Evaluation  Framework      13. The  PhilGEPS,  as  a  central  portal  of  procurement  information  posted  by  

government  entities  and  suppliers,  primarily  aims  to  “establish  an  open,  transparent,  efficient,  and  competitive  marketplace  for  government  procurement.”  To  this  end,  PhilGEPS  offers  the  following  basic  features:  

 • Electronic  bulletin  board  • Subscribers  registry  • E-­‐catalogue  

 14. Evaluation  of  the  system  for  this  baseline  report  is  guided  by  the  criteria  

“open,  transparent,  efficient,  and  competitive  marketplace”      

Diagram  1  

     15. Improved  openness,  transparency,  efficiency,  and  competitiveness  in  the  e-­‐

procurement  system  will  increase  subscription  and  use  of  the  PhilGEPS.  Increased  subscription  and  use  of  the  PhilGEPS  indicate  greater  confidence  in  the  system.  Consequently,  increased  trust  in  the  public  procurement  system  encourages  greater  participation  in  the  public  procurement  market.  This  virtuous  cycle  strengthens  the  competitiveness  of  public  procurements  to  the  advantage  of  government.    

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16. The  evaluation  takes  into  consideration  the  system’s  limitations  brought  about  by  policy  and/or  design.    

       Evaluation  Criteria    17. The  report  adopts  the  following  criteria  and  its  operational  use  for  the  

evaluation  of  the  PhilGEPS:    17.1. Openness  is  evaluated  in  terms  of  registration  with  the  system.  

The  number  of  suppliers  and  buyers  registered  with  the  system  is  an  indication  of  acceptance  of  an  open  and  transparent  system  of  transacting  with  government,  as  prescribed  by  law.    

17.2. Transparency  is  evaluated  in  terms  of  postings  of  bid  notices  and  award  notices  by  the  users  of  the  system.    

 17.3. Efficiency  is  evaluated  in  terms  of  increased  subscriptions  to  the  

various  features  offered  by  the  system,  such  as  matching  services.  This  also  includes  a  simple  assessment  of  the  database  design  in  effectively  gathering  and  processing  procurement  information  useful  for  the  various  stakeholders  of  the  system.    

 17.4. Competitiveness  is  evaluated  in  terms  of  the  varied  levels  of  

participation  of  suppliers  (order  of  opportunities,  placement  of  orders,  and  awards).    

 17.4.1. The  profiles  of  top  winning  bidders  are  also  indicative  of  the  

competitiveness  of  the  public  procurement  market  as  captured  by  the  PhilGEPS.      

17.4.2. The  system’s  design  and  the  users’  appreciation  of  the  system  are  additional  indicators  of  the  competitiveness  of  public  procurement.    

 17.4.3. Another  useful  indicator  is  the  amount  of  savings  generated  by  the  

government  agencies  through  public  procurement.                              

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             A  Brief  Description  of  the  System    18. The  PhilGEPS  in  its  current  state  is  limited  both  by  design  and  policy.  Below  

is  a  simple  diagram  describing  the  system’s  operative  functions:      

   

     

19. The  system  has  three  types  of  users:  the  buyers,  suppliers,  and  the  PMO  as  administrator  of  the  system.  

 Design  limitations    20. Registration  into  the  system  is  done  by  the  buyers,  suppliers,  and  the  PMO.  In  

the  early  years  of  the  system,  the  PMO  creates  the  accounts  of  users  as  a  service  to  walk-­‐in  clients  and  other  clients  that  request  the  assistance  of  the  PMO.  Online  registration  is  also  an  available  option  for  users  who  wish  to  input  their  own  profile  information.    

PhilGEPS   Manual  system  

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During  the  transfer  of  the  system  in  2006  (relaunch  of  PhilGEPS),  all  old  accounts  were  tagged  ADMIN-­‐CREATED  even  if  many  of  these  accounts  were  created  by  the  users  themselves  through  online  registration.    

21. The  buyers  input  the  bid  notice  information  (otherwise  known  as  bid  notice  postings).  Suppliers  who  subscribed  to  bid-­‐matching  services  based  on  indicated  preferences  (e.g.  according  to  business  category)  are  properly  notified  by  the  system  of  potentially  matched  bid  opportunities.    

22. The  suppliers  order  opportunities  through  the  system.  These  suppliers  form  part  of  the  Document  Request  List  (DRL).  Some  other  suppliers,  however,  still  prefer  to  order  opportunities  manually  or  outside  the  PhilGEPS.  These  suppliers  do  not  form  part  of  the  DRL.    

 23. The  actual  submission,  opening,  and  evaluation  of  bids  are  done  manually.  

Information  from  these  activities  is  not  captured  by  the  system.      24. The  buyers  post  the  award  notices  through  the  system.  Buyers  are  however  

limited  to  listing  suppliers  who  are  part  of  the  DRL.  Buyers  are  unable  to  post  award  notices  where  the  supplier  manually  ordered  opportunities  without  the  assistance  of  PMO.  PMO  belatedly  inputs  the  supplier  information  (ordered  opportunities)  as  per  request  of  the  agencies  so  that  they  can  properly  reflect  award  notices  through  the  system.  

 Policy-­‐defined  limitations    25. There  are  notable  policy  regulations  that  have  affected  the  system’s  ability  to  

capture  important  information.  The  Government  Procurement  Reform  Act  (2003)  Implementing  Rules  and  Regulations  have  identified  the  PhilGEPS  registration  certificate  as  one  of  the  requirements  for  eligibility.  This  required  suppliers  to  subscribe  to  the  system  so  that  they  can  participate.  In  2009,  the  revised  IRR  effected  the  reduction  of  the  number  of  required  eligibility  documents  to  improve  the  participation  of  bidders.  One  of  the  documents  removed  in  the  eligibility  check  is  the  PhilGEPS  registration  certificate.  Instead,  this  was  to  be  validated  during  post-­‐qualification  check.  In  effect,  only  the  winning  bidders  were  required  to  acquire  PhilGEPS  registration.    

 26. The  revised  IRR  of  2009  also  defined  which  procurements  only  require  

postings  of  bid  notices/  award  notices  at  the  PhilGEPS,  as  follows:    

26.1. Procurement  of  common  use  goods  and  supplies  are  exempted  from  the  posting  requirements  (bid  and  award  notices);    

26.2. Posting  of  bid  notices  (or  request  for  submission  of  price  quotations)  in  the  PhilGEPS  are  exempted  for  Shopping  of  ordinary  or  regular  office  supplies  and  equipment  not  available  at  the  Procurement  Service  where  the  amount  does  not  exceed  the  following  limits:    26.2.1. For  NGAs,  GOCCs,  GFIs,  and  SUCs,  P500,000  

 

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26.2.2. For  local  government  units    

     

26.3. Posting  of  bid  notices  or  (request  for  submission  of  price  quotations)  in  the  PhilGEPS  are  exempted  for  Negotiated  Procurement  except  those  under  two  failed  biddings.    

26.4. Posting  of  bid  notices  (or  request  for  submission  of  price  quotations)  in  the  PhilGEPS  are  exempted  for  small  value  procurements  where  the  amount  does  not  exceed  the  same  limits  for  shopping  of  ordinary  or  regular  office  supplies  and  equipment.      

                                                     

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     Summary  of  Findings  and  Analyses    27. As  a  baseline  report,  the  findings  herein  are  reflective  of  the  pains  involved  in  

the  initial  development  and  use  of  the  system  by  various  stakeholders.  Ordinarily,  baseline  information  is  collected  from  the  beginning  year  of  a  project/  program  and  not  a  period  composed  of  several  years.  However,  considering  the  various  developments  and  improvements  made  on  the  PhilGEPS  from  its  initial  creation  in  2000,  baseline  information  on  the  effectiveness  of  the  system  may  be  better  presented  covering  the  initial  flight  of  the  PhilGEPS  in  2001-­‐2007.  The  baseline  period  represents  various  initial  flights  (2001-­‐2002,  2003-­‐2005,  2006-­‐2007).    

28. Openness.      Suppliers.    

28.1. There  is  increase  in  the  number  of  registered  suppliers  in  the  succeeding  year  from  the  time  the  system  is  introduced/  reintroduced  (2001-­‐2002,  2003-­‐2004,  2006-­‐2007).  However,  when  the  system  shifts  from  one  version  to  another  (2002-­‐2003;  2005-­‐2006),  there  are  notable  adjustments  that  affect  the  registration  of  suppliers  –  a  decrease  in  the  number  of  supplier  registrants  is  observed.  

   

Table  1.  Philippine  Suppliers  (from  Subscriber  Organizations  by  Country  and  Province/  State,  Member  Type  Selected:  Supplier)  

2001

2002

2003

2004

2005 2006 2007

NEW USERS - - - - - 4,564 6,694

EXISTING USERS - - - - - 14,009 18,321

TOTAL 781 1,794 1,667 5,314 4,533 18,573 25,015

                               

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 Figure  1.  

   Figure  2.  

     

Table  2.  Foreign  Suppliers  (from  Subscriber  Organizations  by  Country  and  Province/  State,  Member  Type  Selected:  Supplier)  

2001 2002 2003 2004 2005 2006 2007

NEW USERS - - - - - 37 91

EXISTING USERS - - - - - 124 157

TOTAL 17 21 21 27 39 161 248

             

781  1,794   1,667  

5,314  4,533  

0  

1,000  

2,000  

3,000  

4,000  

5,000  

6,000  

2001   2002   2003   2004   2005  

Philippine  Suppliers  

14,009  18,321  

4,564  

6,694  

0  

5,000  

10,000  

15,000  

20,000  

25,000  

30,000  

2006   2007  

New  Users  

Existing  Users  

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Figure  3.  

   Figure  4.  

     

 28.2. More  and  more  suppliers  outside  the  National  Capital  Region  are  

registered  with  the  PhilGEPS.  Suppliers  from  the  NCR  show  a  decreasing  share  of  the  total  registered  suppliers  through  the  period  2001-­‐2007.  In  2001,  suppliers  from  NCR  compose  95%  of  the  total  registered  suppliers.  This  was  brought  down  to  88%  in  2002,  75%  in  2003,  38%  in  2004  and  finally  32%  in  2007.  In  contrast,  suppliers  from  Region  4A  have  increasingly  subscribed  to  the  system.  In  2001,  Region  4A  suppliers  compose  only  2%  of  the  total  registered  suppliers.  Its  share  in  the  succeeding  years  has  increased  to  as  much  as  18%  (2005).    

             

17  21   21  

27  

39  

0  5  10  15  20  25  30  35  40  45  

2001   2002   2003   2004   2005  

Foreign  Suppliers  

124  157  

37  

91  

0  

50  

100  

150  

200  

250  

300  

2006   2007  

New  Users  

Existing  Users  

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 Buyers.    

Table  3.  Registered  Buyers  (from  Data  Dump:  Organizations)     2001   2002   2003   2004   2005   2006   2007  

NCR   686   48   29   77   91   27   47  

Region  I   49   14   6   128   296   754   599  

Region  II   7   134   4   17   8   8   19  

Region  III   62   12   8   42   70   30   40  

Region  IV-­A   16   34   26   124   196   139   169  

Region  IV-­B   0   11   12   7   21   7   12  

Region  V   56   4   44   66   19   21   73  

Region  VI   59   76   20   17   11   17   30  

Region  VII   78   45   34   17   156   33   26  

Region  VIII   6   69   21   20   31   39   157  

Region  IX   58   0   23   8   6   10   17  

Region  X   65   13   9   86   41   42   110  

Region  XI   53   1   18   57   9   11   12  

Region  XII   5   19   8   41   26   8   12  

ARMM   5   47   3   9   3   1   6  

CAR   48   4   10   34   8   8   18  

Caraga   45   0   7   83   7   5   4  

TOTAL   1298   531   282   833   999   1160   1351  

     Table  4.  Registered  Buyers  by  Government  Branch  (from  Data  Dump:  Organizations)  

Government Branch 2001 2002 2003 2004 2005 2006 2007 Constitutional Office 2 1 0 1 1 8 231

Executive 1205 375 137 331 356 144 3

Legislative 5 1 2 1 2 3 3

Judiciary 35 7 0 0 1 0 0 Local Government Unit (LGU) 51 146 142 498 637 1005 1113 NGO 0 1 1 2 2 0 1

Grand Total 1298 531 282 833 999 1160 1351

   

28.3. There  is  significant  increase  of  registrants  among  LGUs  in  2006-­‐2007.  On  the  other  hand,  a  significant  number  of  executive  offices  have  been  registered  with  the  system  as  early  as  2001  with  a  few  others  following  in  the  succeeding  years.  It  will  be  recalled  that  when  the  system  was  first  developed  in  2000  supported  by  an  executive  order,  only  the  executive  offices  were  covered  by  the  system.  

             

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29. Transparency.    General  Picture    

29.1. In  absolute  value,  there  is  significant  increase  in  the  number  of  bid  notice  and  award  notice  postings  as  the  system  matures.    

 Table  5.  Bid  Notice  Postings    

(from  Number  of  Bid  Notices  by  Region)  

YEAR BID NOTICES

POSTED

2001 2,048

2002 10,291

2003 19,003

2004 43,296

2005 86,594

2006 128,264

2007 166,707

   

Table  6.  Award  Notice  Postings    (from  Number  of  Bid  Notices  by  Region)  

YEAR AWARD NOTICES

POSTED

2001 278

2002 2,078

2003 2,973

2004 4,977

2005 13,341

2006 13,109

2007 19,237

 29.2. However,  in  terms  of  award  notice-­‐bid  notice  ratio,  there  is  still  

very  low  compliance  (10-­‐20%).  Compliance  was  better  in  2001-­‐2003  than  in  the  succeeding  years,  albeit  under  a  more  defined  legal  framework.  On  the  average,  award/bid  notice  posting  compliance  is  at  12%  or  approximately  1  award  notice  for  every  8  bid  notices  posted.  

 Table  7  

YEAR

COMPLIANCE (AWARD/BID

NOTICE POSTINGS)

2001 14%

2002 20%

2003 16%

2004 11%

2005 15%

2006 10%

2007 12%

 Buyers.      

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29.3. The  top  complying  government  agencies  in  terms  of  posting  of  bid  notices  and  award  notices  are  as  follows:    

Table  8.  Top  complying  agencies  (from  Amount  of  Notices  Posted  (by  Agency))  YEAR   AGENCY   #  BID  NOTICES  

POSTED  #  AWARD  NOTICES  POSTED  

COMPLIANCE  RATE  

2001   Procurement  Service-­‐Purchasing  Division   356   46   13%  2002   LANDBANK  OF  THE  PHILIPPINES  -­‐  HEAD  

OFFICE  813   430   53%  

2003   OFFICE  OF  THE  PRESIDENT   898   447   50%  2004   OFFICE  OF  THE  PRESIDENT   1223   834   68%  2005   CITY  OF  MANILA   1244   946   76%  2006   PROVINCE  OF  RIZAL   1381   1094   79%  2007   PROVINCE  OF  ZAMBOANGA  SIBUGAY   2165   1220   56%  

     

29.4. In  2006,  the  top  complying  agency  in  terms  of  bid  notice  postings  is  the  Department  of  Public  Works  and  Highways.  This  was  followed  by  a  far  second  from  a  regional  office  of  a  line  agency.  In  close  third,  fourth  and  fifth  are  provincial  governments  with  varied  income  classes  –  Zamboanga  Sibugay,  a  2nd  class  province,  had  more  bid  notices  posted  than  the  1st  class  province  of  Laguna.    

Table  9  

Agencies

Number of Bid Notices

Posted DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS - MAIN

5,862

DEPARTMENT OF SOCIAL WELFARE AND DEVELOPMENT - REGION IX

1,933

PROVINCE OF ZAMBOANGA SIBUGAY

1,900

PROVINCE OF LAGUNA 1,764

PROVINCE OF MARINDUQUE

1,547

 29.5. Of  the  1721  procuring  entities  with  procurements  captured  by  the  

system  in  2006,  77%  or  1,333  entities  did  not  post  any  award  notice.  This  is  very  low  compliance.  Below  is  a  ranked  listing  of  agencies  with  the  most  award  notices  posted:      

Table  10  

Agencies

Number of Notices with

Awards PROVINCE OF RIZAL 1,094

CITY OF MANILA 872

CITY OF PASIG 488

PROCUREMENT SERVICE - PURCHASING DIVISION

472

PROVINCE OF ZAMBOANGA SIBUGAY

441

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29.6. In  2007,  the  top  complying  agencies  in  terms  of  bid  notice  postings  are  the  local  governments  –  3  provinces,  1  city,  and  a  municipality,  as  follows.  

Table  11  

Agencies

Number of Notices Posted

PROVINCE OF LAGUNA

2,228

PROVINCE OF ZAMBOANGA SIBUGAY

2,165

CITY OF BATANGAS, BATANGAS

1,931

PROVINCE OF NEGROS ORIENTAL

1,709

MUNICIPALITY OF SAN FABIAN, PANGASINAN

1,695

     

29.7. There  is  increasing  non-­‐compliance  in  terms  of  posting  of  award  notices  from  77%  in  2006  to  80%  or  1,946  out  of  2,440  procuring  entities  in  2007.  The  top  complying  agencies  are  once  again  local  government  units  –  2  provinces  and  3  cities  –  with  varied  income  classes.    

   

Table  12  

Agencies

   

Number  of  Notices  with  Awards

PROVINCE OF ZAMBOANGA SIBUGAY

1,220

PROVINCE OF RIZAL

1,112

CITY OF URDANETA, PANGASINAN

956

CITY OF BATANGAS, BATANGAS

673

   

29.8. The  record  of  top  compliant  procuring  entities  in  terms  of  postings  in  the  regions  show  that  there  was  improved  performance  during  the  first  years  of  implementation  of  the  PhilGEPS  (2001-­‐2003).  However,  during  the  latter  developments  of  the  system,  compliance  has  fluctuated  to  lower  rates.      

Table  13.  Top  performing  regions    

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in  Award/BidNotice  Postings  

TOP PERFORMING REGIONS

COMPLIANCE (AWARD/BID NOTICE POSTINGS)

2001 NCR 14%

2002 REGION X 69%

2003 REGION IX 84%

2004 REGION X 18%

2005 REGION IV-A 32%

2006 CARAGA 16%

2007 REGION IX 30%

 (See  Annex  B  to  see  performance  of  all  regions  from  2001-­‐2007)  

 30. Efficiency  

 30.1. There  is  an  increasing  number  of  local  suppliers  who  avail  of  the  

bid  matching  services  of  the  PhilGEPS.    

Table  14.  Supplier-­‐subscribers  of  the  Matching  Services  (from  Subscriber  Organizations  

By  Country  and  Province/  State)  

2006 % of Total 2007

% of Total

Foreign Suppliers 10 27% 20 22% Local Suppliers 1305 29% 3270 49%

   

30.2. System  Design  Flaws    30.2.1. The  design  of  the  system  has  certain  flaws,  however,  which  affects  

the  quality  of  information  provided  by  the  system.  As  shown  in  Table  4,  there  are  231  registered  organizations  under  the  Constitutional  Office  category  in  2007.    In  the  same  light,  the  Subscriber  Organizations  table  (2006-­‐2007)  show  duplicate  entries  of  possibly  misspelled  states/  provinces:    

Table  15.  2006  Subscriber  Organizations  By  Country  and  Province/  State  –  Duplicate  

Entries  Country   Province/  State  Australia   New  South  Wales  (1)  

NSW  (1)  VIC  (1)  Victoria  (1)  

Japan   Osaka  (1)  Unknown  (1)  

Korea,  Republic  of   SEOUL  (2)  Seoul,  (1)  

United  States   CA  (1)  CA,  (1)  California  (3)  Hawaii  (1)  Hawaii,  (1)  Il  (1)  Illinois  (1)  Maryland  (4)  

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Maryland,  (1)  Michigan  (2)  Michigan,  (1)  Michingan  (1)  New  York  (1)  NY  (1)  Texas  (3)  Texas,  (1)  TX  (2)  

       

30.2.2.  The  site  contains  no  description  of  the  kinds  of  data  that  each  report  (spreadsheet  file  or  webpage)  contains.  The  absence  of  any  descriptive  information  about  the  reports  generated  by  the  system  limits  the  ability  of  users  to  choose  more  appropriate  data  for  their  study  purposes.    

 31. Competitiveness  

 Figure  5.  

   

28.1 The  rate  of  participation  of  registered  suppliers  has  dwindled  over  time.  In  2001,  the  participation  rate  is  71%.  In  2007,  this  went  down  to  33%.  About  a  third  to  a  half  of  the  registered  suppliers  are  able  to  successfully  receive  contract  awards  through  the  system.    

 Table  16.  Suppliers  that  Participated  and  Received  Awards   2001 2002 2003 2004 2005 2006 2007

TOTAL 798 1815 1688 5341 4573 4601 6785 ORDERED OPPORTUNITIES 565 1091 672 1925 1710 1404 2269

PLACED ORDERS 565 1091 672 1925 1710 1404 2269

RECEIVED AWARDS 368 656 522 1858 1465 1496 2649

       

Participant  bidders  Winning  bidders  

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 Suppliers    

28.2 The  highest  number  of  bid  notice  postings  from  2002-­‐2006  is  for  items  under  the  MISCELLANEOUS  business  category.  The  effect  of  this  has  been  to  hamper  ‘accurate’  matching  of  opportunities  with  suppliers  who  have  chosen  specific  business  categories  to  be  matched  with  and  to  receive  notifications  thereon.  MISCELLANEOUS  as  a  catch-­‐all  category  defeats  the  BID-­‐MATCHING  service  (efficiency),  circumvents  the  requirements  of  transparency,  and  as  a  result  obstructs  competition.    

 28.3 Below  are  profiles  of  top  winning  suppliers  each  year,  which  

contain  useful  information  on  the  level  of  competitiveness  (and  even  trustworthiness)  of  the  public  procurement  system  of  the  country.  In  2003,  the  top  awarded  supplier  according  to  the  system  has  not  ordered  any  opportunity.  Similarly  in  2005-­‐2007,  the  top  awarded  suppliers  had  more  winnings  than  participation  in  bid  opportunities.  

 Table  17.  Profile  of  top  winning  supplier  for  2001  

Name  of  Supplier   BAN  BEE  COMMERCIAL  CO.,  INC  Type  of  Organization   Corporation  #  of  Employees   20  Awards  received   2,226  Opportunities  ordered   66,037  Success  Rate   3%  %  Share  of  Total    Awards  

8%  

 Table  18.  Profile  of  top  winning  supplier  for  2002  

Name  of  Supplier   MCSA  MARKETING  Type  of  Organization   Single  Proprietorship  #  of  Employees   9  Awards  received   1,495  Opportunities  ordered   6,530  Success  Rate   23%  %  Share  of  Total    Awards  

7%  

 Table  19.  Profile  of  top  winning  supplier  for  2003  

Name  of  Supplier   NEMRAC  COMMERCIAL  AND  MEDICAL  SUPPLIES  Type  of  Organization   Single  Proprietorship  #  of  Employees   8  Awards  received   2,426  Opportunities  ordered   0  Success  Rate   ???  %  Share  of  Total    Awards  

17%  

 Table  20.  Profile  of  top  winning  supplier  for  2004  

Name  of  Supplier   GROUP  5  AUDIO  VISUAL  SYSTEMS  CORP  Type  of  Organization   Corporation  #  of  Employees   30  Awards  received   2,491  Opportunities  ordered   8,362  Success  Rate   30%  %  Share  of  Total    Awards  

5%  

 Table  21.  Profile  of  top  winning  supplier  for  2005  

Name  of  Supplier   Supplier  P  &  H  MERCHANDISING  Type  of  Organization   Corporation  #  of  Employees   21  

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Awards  received   2,691  Opportunities  ordered   1,639  Success  Rate   164%  ???  %  Share  of  Total    Awards  

8%  

 Table  22.  Profile  of  top  winning  supplier  for  2006  

Name  of  Supplier   BLU  ENTERPRISES  Type  of  Organization   Single  Proprietorship  #  of  Employees   7  Awards  received   852  Opportunities  ordered   751  Success  Rate   113%  ???  %  Share  of  Total    Awards  

3%  

 Table  23.  Profile  of  top  winning  supplier  for  2007  

Name  of  Supplier   HEALTH  LINE  MEDICAL  DISTRIBUTIONS,  INC  Type  of  Organization   Corporation  #  of  Employees   3  Awards  received   904  Opportunities  ordered   128  Success  Rate   706%  ???  %  Share  of  Total    Awards  

2%  

                                           

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 Conclusion  and  Recommendations  (Initial)    29 The  system  has  to  improve  on  Efficiency,  Transparency,  and  

Competitiveness  to  gain  more  in  terms  of  Openness.    

30 Efficiency  of  the  system  can  be  improved  by  fine-­‐tuning  the  database  design  in  the  following  aspects:  

 30.1 User  fields  can  be  more  controlled  by  pre-­‐identifying  definable  

options  rather  than  having  users  to  freely  input  the  data  required,  such  as:    30.1.1 States/Provinces  of  the  Countries  of  the  suppliers  30.1.2 Buyer  name  

 30.2 Tighter  controls  in  the  identification  of  business  categories  by  

buyers  to  ensure  effectiveness  and  accuracy  of  bid-­‐matching  services    

31 Efficiency  can  also  be  improved  by  putting  in  place  policies  that  will  enforce  the  posting  obligations  of  users.  While  the  eligibility  requirement  of  PhilGEPS  registration  may  be  foregone,  during  post-­‐qualification,  users  that  have  not  registered  with  the  system  before  the  deadline  of  submission  of  bids  may  be  automatically  post-­‐disqualified.  This  reading  of  the  policy  compels  users  to  register  with  the  system  even  if  it  is  not  a  requirement  for  eligibility.      

32 Transparency  can  be  improved  through  a  rewards  and  incentives  mechanism,  such  as  citing  top  complying  agencies  and  shaming  agencies  that  have  not  complied  with  the  posting  requirements  set  by  law.  Sanctions  could  also  strengthen  the  enforcement  of  the  posting  policy.  

 33 Competitiveness  is  improved  if  there  is  greater  transparency  and  efficiency  

in  the  system.  PhilGEPS  can  show  the  statistics  that  illustrate  improved  competitiveness  of  procurement  in  specific  agencies  (in  terms  of  savings)  to  encourage  other  agencies  to  be  compliant  with  the  posting  requirements  set  by  law.    

                         

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 Annex  A.      Outline  of  the  Full  Report      1. 2008-­‐2011  General  Trends  2. 2008-­‐2011  Regional  Trends  (National  Capital  Region,  Region  3,  Region  4A)  

3. 2008-­‐2011  Cities  of  Davao  and  Cebu  4. Performance  of  the  22  National  Government  Agencies  5. Conclusion  and  Recommendations                                                                            

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Annex  B.    Regional  Performance  in  Terms  of  Award/Bid  Notice  Postings  (2001-­2007)    2001

Region Bid Notices Posted

With Award Notices

Award/ Bid Notice Postings Ranking

ARMM 0 0 0.00% 3 CAR 6 0 0.00% 3 Caraga 0 0 0.00% 3 NCR 2,031 276 13.59% 2 Region I 2 2 100.00% 1 Region II 0 0 0.00% 3 Region III 6 0 0.00% 3 Region IV-A 1 0 0.00% 3 Region IV-B 0 0 0.00% 3 Region IX 0 0 0.00% 3 Region V 1 0 0.00% 3 Region VI 0 0 0.00% 3 Region VII 0 0 0.00% 3 Region VIII 0 0 0.00% 3 Region X 0 0 0.00% 3 Region XI 1 0 0.00% 3 Region XII 0 0 0.00% 3 Total 2,048 278    

2002

Region Bid Notices Posted

With Award Notices

Award/ Bid Notice Postings Ranking

ARMM 1 0 0% 8 CAR 68 0 0% 8 Caraga 2 0 0% 8 NCR 9,843 2,021 21% 4 Region I 29 14 48% 2 Region II 8 0 0% 0 Region III 24 0 0% 0 Region IV-A 123 3 2% 6 Region IV-B 16 4 25% 3 Region IX 9 1 11% 5 Region V 21 0 0% 8 Region VI 32 0 0% 8 Region VII 52 1 2% 7 Region VIII 4 0 0% 8 Region X 49 34 69% 1 Region XI 2 0 0% 8 Region XII 8 0 0% 8 Total 10,291 2,078    

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2003

Region Bid Notices Posted

With Award Notices

Award/ Bid Notice Postings Ranking

ARMM 11 1 9.09% 7 CAR 91 1 1.10% 10 Caraga 9 0 0.00% 14 NCR 16,659 2,754 16.53% 6 Region I 99 1 1.01% 11 Region II 42 0 0.00% 14 Region III 356 1 0.28% 13 Region IV-A 336 17 5.06% 8 Region IV-B 56 12 21.43% 4 Region IX 31 26 83.87% 1 Region V 27 0 0.00% 14 Region VI 694 35 5.04% 9 Region VII 249 50 20.08% 5 Region VIII 168 1 0.60% 12 Region X 89 72 80.90% 2 Region XI 77 0 0.00% 14 Region XII 9 2 22.22% 3 Total 19,003 2,973    

2004

Region Bid Notices Posted

With Award Notices

Award/ Bid Notice Postings Ranking

ARMM 0 0 0.00% 17 CAR 540 7 1.30% 14 Caraga 717 51 7.11% 4 NCR 24,604 4,156 16.89% 2 Region I 2,858 62 2.17% 11 Region II 350 13 3.71% 8 Region III 624 13 2.08% 13 Region IV-A 1,948 114 5.85% 6 Region IV-B 192 2 1.04% 15 Region IX 1,177 39 3.31% 9 Region V 2,651 76 2.87% 10 Region VI 2,346 49 2.09% 12 Region VII 1,697 191 11.26% 3 Region VIII 1,331 91 6.84% 5 Region X 444 82 18.47% 1 Region XI 1,342 8 0.60% 16 Region XII 475 23 4.84% 7 Total 43,296 4,977 11.50%                

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2005

Region Bid Notices Posted

With Award Notices

Award/ Bid Notice Postings Ranking

ARMM 11 1 9.09% 11 CAR 860 129 15.00% 7 Caraga 768 186 24.22% 3 NCR 36,694 6,921 18.86% 5 Region I 13,247 1,253 9.46% 10 Region II 362 60 16.57% 6 Region III 1,353 74 5.47% 14 Region IV-A 7,942 2,562 32.26% 1 Region IV-B 203 24 11.82% 9 Region IX 4,979 1,020 20.49% 4 Region V 5,977 175 2.93% 16 Region VI 4,543 158 3.48% 15 Region VII 2,569 223 8.68% 12 Region VIII 3,888 233 5.99% 13 Region X 570 144 25.26% 2 Region XI 1,329 15 1.13% 17 Region XII 1,299 163 12.55% 8 Total 86,594 13,341    

2006

Region Bid Notices Posted

With Award Notices

Award/ Bid Notice Postings Ranking

ARMM 19 0 0.00% 17 CAR 942 76 8.07% 5 Caraga 942 147 15.61% 1 NCR 44,940 6778 15.08% 2 Region I 22,977 1521 6.62% 9 Region II 403 16 3.97% 11 Region III 2,111 77 3.65% 14 Region IV-A 17,406 2100 12.06% 4 Region IV-B 1,839 45 2.45% 16 Region IX 6,426 467 7.27% 7 Region V 8,178 205 2.51% 15 Region VI 4,978 189 3.80% 12 Region VII 5,691 333 5.85% 10 Region VIII 6,168 807 13.08% 3 Region X 1,237 97 7.84% 6 Region XI 842 31 3.68% 13 Region XII 3,165 220 6.95% 8 Total 128,264 13109 10.22%            

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 2007

Region Bid Notices Posted

With Award Notices

Award/ Bid Notice Postings Ranking

ARMM 71 0 0.00% 17 CAR 1,441 105 7.29% 7 Caraga 1,243 12 0.97% 16 NCR 48,952 8336 17.03% 2 Region I 39,341 2793 7.10% 8 Region II 861 19 2.21% 15 Region III 3,458 216 6.25% 10 Region IV-A 26,377 3843 14.57% 3 Region IV-B 2,389 218 9.13% 6 Region IX 5,441 1652 30.36% 1 Region V 9,554 314 3.29% 12 Region VI 7,654 208 2.72% 13 Region VII 7,123 387 5.43% 11 Region VIII 5,907 714 12.09% 4 Region X 2,597 262 10.09% 5 Region XI 1,368 93 6.80% 9 Region XII 2,930 65 2.22% 14 Total 166,707 19237 11.54%